Watchmakers gave upbeat forecasts for 2011 at the industry's largest fair on Wednesday, although the Japan earthquake and instability in the Middle East cast a shadow.
Published: 24 March 2011 10:16 CET
Industry giants including Swatch and LVMH have all posted strong recoveries over 2010, as consumers started spending again following the previous year’s financial crisis, and they are expecting the recovery to continue in 2011.
Swiss exhibitors underlined that January sales were up 16.9 percent over a year ago and predicted that 2011 would be a new record year for the industry.
“This return to full health has been confirmed through the whole of the year just gone by, so let us assume that 2011 is going to turn out to be just as positive and that the entire industry will thus be able to continue to progress,” said Sylvie Ritter, who manages the Baselworld fair.
However, the earthquake in Japan and an ensuing nuclear crisis as well as popular uprisings in the Arab world have cast shadows over those forecasts.
“Although the movement appears to be heading in the right direction, our uncertain geopolitical situation still makes it imperative for us to be cautious in our analyses,” acknowledged Jacques Duchene, who heads the committee of exhibitors.
The organisers of Baselworld did not expect any cancellations from Japanese exhibitors, but Ritter believed that the disaster was expected to have some impact on the industry.
“From the point of view of luxury consumption, Japan is a very important market,” she said.
“We expect some modifications but we hope that they will be just temporary,” she added, in response to a question about the possible impact on the industry.
Luxury brands from Chopard to Rolex to Patek Philippe trotted out their latest timepieces at the fair, which is expected to attract some 100,000 visitors.
Organisers said 1,892 exhibitors form 45 countries are showcasing their latest creations over eight days over 160,000 square metres in the northern Swiss city of Basel.
Francois Thiebaud, who represents exhibitors from Switzerland, said that trends this year include a “return to classic models, inspired by the 1950s and 60s.”
The designs are “less exuberant” with steel and gold as favoured materials this year.
Watchmakers have experienced a dramatic recovery in 2010 after the financial crisis.
The world’s biggest watchmaker, Swatch, posted a 41.5 percent jump in 2010 net earnings to 1.1 billion Swiss francs ($1.2 billion), and promised to smash through 10 billion francs in sales in about three years’ time.
French group LVMH meanwhile soared past the 3 billion euros mark in profit in 2010 while Richemont said sales were up a third to 2.1 billion euros in the first quarter of 2011 alone.
The survey, which polled 12,420 people for its 2021 edition, ranks cities based on criteria such as Quality of Urban Living, Getting Settled, Urban Work Life, Finance & Housing, and Local Cost of Living, along with their sub-categories.
Of the four Swiss cities analysed in the study — Geneva, Zurich, Basel, and Lausanne — only Basel was highly rated, and is one of only three European cities ranked in the top 10 (the others are Prague, in 7th place, and Madrid in 10th).
This is why
A popular destination for international employees because of its pharmaceutical industry, including giants like Roche and Novartis, Basel ranked well across all categories.
For instance, it is in the 1st place for its public transportation network, in a 2nd position in terms of Quality of Urban Living, and in 3rd for Safety & Politics.
All expats in Basel (100 percent) are satisfied with public transportation, versus 69 percent globally. The public transportation system is excellent”, one respondent said.
Nearly all participants (97 percent) feel safe there, against 84 percent globally. The city also performs well in the Urban Work Life Index (6th), particularly for the state of the local economy, which is in the 1st place and the working hours (8th); additionally, 75 percent are happy with their working hours, compared to 66 percent globally.
More than four in five expats (84 percent) find their disposable household income enough or more than enough to cover their expenses (versus 77 percent globally), and 77 percent are satisfied with their financial situation (against 64 globally).
Where Basel is doing less well is in the Finance & Housing Index (34th place), though it still ranks ahead of other Swiss cities: Zurich (37th), Lausanne (39th), and Geneva (53rd).
But the city ranks 48th in the Local Cost of Living Index: 69 percent of foreigners living there are dissatisfied with the cost of living, more than double the global average (34 percent).
The Getting Settled Index (39th) is another of Basel’s weak points. Internationals struggle with getting used to the local culture: more than one in four respondents (26 percent) state that they find this difficult — this figure is 18 percent 1globally.
It is worth mentioning that in the 2020 InterNations survey, Basel ranked in the 24th place, so it progressed impressively this year.
What about Geneva?
Switzerland’s most “international” city due to the presence of a number of United Nations agencies and multinational companies, places near the bottom of the ranking, in the 47th place.
“It has the worst results among the Swiss cities included in the report and is the only one that does not rank in the global top 10 of the Quality of Urban Living Index”, InterNations said.
Similar to the other Swiss cities, Geneva ranks among the top 10 for political stability (1st) and in the bottom 10 for the affordability of healthcare (56th). However, it lags behind for all other factors, with expats particularly dissatisfied with the local leisure options (23 percent versus 14 percent globally).
“Interestingly, the comparably low quality of life does not make Geneva any easier to afford: on the contrary, it is the worst-ranking city worldwide in the Local Cost of Living Index (57th) and by far the worst-rated Swiss city in the Finance & Housing Index (53rd)”, the report noted.
It added that “while Geneva comes 26th in the Finance Subcategory, it ranks 55th in the Housing Subcategory, only ahead of Dublin (56th) and Munich (57th). Expats find housing in Geneva unaffordable (87 percent vs. 39 percent globally) and hard to find (63 percent vs. 23 percent globally).”
Geneva has a fairly average performance in the Urban Work Life Index (28th) but receives worse results in the Getting Settled Index (43rd). It ends up in the bottom 10 of the Feeling Welcome (52nd), Local Friendliness (50th), and Friends & Socializing (48th) subcategories.
“It is certainly not easy to integrate into the local culture and community,” said one respondent. In fact, 35 percent find the locals generally unfriendly, against 16 percent globally).
The difficulty is making friends in Switzerland is a well-known phenomenon among the international community.